Bank of America Hartnett: The bubble in U.S. stocks and digital currencies is intensifying
Hartnett stated that the S&P 500 Index and Bitcoin have reached 6,100 points and $100,000 per ounce, respectively, indicating that they have begun to bubble. If the S&P rises further to 6,666 points (an increase of about 10% from the current level), then the risk of a "super adjustment" in the U.S. stock market in early 2025 is very high
The US stock and cryptocurrency markets are accumulating bubbles.
Bank of America strategist Michael Hartnett recently released a research report stating that as the S&P 500 index and Bitcoin reach 6,100 points and $100,000/ounce respectively, these two asset classes have begun to bubble.
Hartnett further stated, if the S&P 500 index continues to rise to 6,666 points (about a 10% increase from current levels), then the risk of a "super adjustment" in the US stock market in early 2025 is very high.
Relevant data shows that since the beginning of this year, the S&P has accumulated a rise of over 28%, and the price-to-book ratio has soared to 5.3 times, close to the peak of 5.5 times during the 2000 internet bubble.
At the same time, Bitcoin's price has surged over 136% this year, with its market value once soaring to $2 trillion. Hartnett stated that this market value is comparable to the world's 11th largest economy.
From the perspective of capital flow, according to Bank of America statistics, as of December 4, there was $136.4 billion flowing into the market that week, marking the largest single-week inflow since March of last year.
Of this, $8.2 billion flowed into stocks, marking the ninth consecutive week of net inflows, $4.9 billion flowed into the bond market, and $3 billion was allocated to cryptocurrencies. The net inflow of funds into the cryptocurrency market over the past four weeks reached a historical high of $11 billion.
The bank's bull-bear indicator also shows that "global prosperity" has not yet formed